Monitoring events in Balochistan, CPEC (China Pakistan Economic Corridor), China's Belt and Road Initiative and it's economic and strategic implications, Pakistan Military operations and ongoing Baloch struggle.News and Reports are collected from open sources to raise awareness among scholars, researchers and public in general.

Search This Blog

China’s Belt and Road Initiative Is Changing the World

In 2013, China announced its plan to fund and construct a global transportation and infrastructure network known as the Belt and Road Initiative (“BRI”). Since that time, BRI projects have helped China to become a rival to the United States and European Union on the geo-political scene. They have also allowed Chinese companies to close the gap with their western counterparts in the global construction, engineering, advanced manufacturing, and logistics sectors. Western companies and governments need to take notice or risk being left behind.

What is the Belt and Road Initiative?

China started the BRI to replicate and expand the old Silk Road trading route, and to expand global markets for Chinese goods and China’s global influence. While the name is a bit confusing, the “belt” refers to rail, road, and other land transportation projects, and the “road” refers to sea transportation projects. Despite the confusing name, the scope and pace of BRI projects is simply amazing. The BRI now includes 71 countries and half of the world’s population, and is expected to cost more than $1 Trillion. The projects span much of Asia, Eastern Europe, Africa, and Latin America. Nevertheless, western companies in the construction industry and western governments have not given the BRI the attention it deserves.

How is the BRI helping Chinese Construction Companies Compete?

The BRI has allowed China to greatly expand the sophistication and global reach of its construction and engineering companies. Chinese companies (many of which are state owned and/or controlled) receive nearly all of the construction contracts for BRI projects (more than $340 Billion in contracts to date). In 2017 the five construction companies with the largest revenue outside of their home country were Chinese and the top eight Chinese construction companies each had more such revenue than the first U.S. based contractor on this list.

The BRI projects are being completed at a break-neck speed and connecting previously isolated and poor parts of the world to the global economy. This is despite the serious safety, quality, and other concerns associated with these projects. The Mombasa-Nairobi railway in Kenya, Africa is a good example. It has been called “the first railway outside China built to Chinese construction standards with Chinese machinery.” Perhaps as a result of these exported standards, per a Chinese engineer working on this project, “On-site accidents are commonplace [and] ‘When they happen, they are almost always severe and often fatal.'”

While such concerns may have slowed down or endangered similar infrastructure projects by western governments or construction companies, they do not seem to have had any such effect on this project. Instead, this project was deemed a success because it was completed 18 months ahead of schedule and shortened certain rail journeys from 10 hours to 4. It is now seen as the first step of a much larger African rail network to be built through the BRI.

How is the BRI Helping China’s Geo-Political Power?

In 2014, the U.S.A. was viewed significantly more favorability around the world than China, but by 2017 this gap had nearly disappeared. BRI projects likely played a large role in this change. The BRI has also helped China greatly increased its geo-political reach (e.g., China’s first overseas military basewas recently established in Djibouti, Africa). It remains to be seen whether these positive effects are sustainable, and serious concerns certainly remain.

Finally, Pakistan is one of the largest recipients of China BRI projects and loans, but is apparently seeking a bailout from the International Monetary Fund of prior IMF loans, leading to concerns that IMF bailout funds would be used to pay back unsustainable loans to China for BRI projects. As the scope of these projects continues to grow, so will China’s influence and leverage over the recipient countries. The long term effect could be quite large.

Conclusion

Largely as a result of BRI projects, over the past five years Chinese construction, engineering and advanced manufacturing companies have closed the gap with their western competitors on perception of quality. With the help of an ever-expanding reach of Chinese geo-political influence and Chinese government-financed projects that appear less concerned with work-place safety or similar issues, this trend will likely continue in the future. While the BRI may fizzle out over time, western companies and governments need to take note of, and take steps to counter, the new Chinese competition or risk being left behind.

Comments

Post a Comment

Popular posts from this blog

“ Commando Muddassir Iqbal was part of the team who conducted Army Public School operation on 16 December 2014. In this video he reveals that he along with other commandos was ordered to kill the innocent children inside school, when asked why should they kill children after killing all the terrorist he was told that it would be a chance to defame Taliban and get nation on the side. He and all other commandos killed children and later Taliban was blamed.
Muddassir Iqbal has deserted the military and now he is with mujahedeen somewhere in AF PAK border area”
For authenticity of this tape journalists can easy reach to his home town to interview his family members or ISPR as he reveals his army service number”
Asalam o Alaikum: My name is Muddassir Iqbal. My father’s name is Naimat Ali. I belong to Sialkot divison (Punjab province), my village is Shamsher Poor and district, tehsil and post office Narowal. Unfortunately I was working in Pakistan army. I feel embarrassed to tell you …

The Rise of China-Europe RailwaysMarch 6, 2018The Dawn of a New Commercial Era?For over two millennia, technology and politics have shaped trade across the Eurasian supercontinent. The compass and domesticated camels helped the “silk routes” emerge between 200 and 400 CE, and peaceful interactions between the Han and Hellenic empires allowed overland trade to flourish. A major shift occurred in the late fifteenth century, when the invention of large ocean-going vessels and new navigation methods made maritime trade more competitive. Mercantilism and competition among Europe’s colonial powers helped pull commerce to the coastlines. Since then, commerce between Asia and Europe has traveled primarily by sea.1Against this historical backdrop, new railway services between China and Europe have emerged rapidly. Just 10 years ago, regular direct freight services from China to Europe did not exist.2 Today, they connect roughly 35 Chinese…